Despite concerns, Conseco deal closes

Conseco Finance finished up its $454 million manufactured housing deal last Thursday at levels significantly wider than initial talk, which is not unusual for this issuer lately.

However, the double-A 10-year average life tranche finished at initial talk of 175 over one-month Libor. Officials at Conseco said the entire deal cleared and they are very pleased MH 2001-4 was able to go down to triple-B.

Admittedly, Conseco was asked many hard questions about its future financial condition. Still, the firm's mid-November investor conference was helpful in getting dealers and portfolio managers comfortable in participating in the new issue, an official said.

Investor demand came from a variety of accounts, including ABS CDOs. The triple-Bs likely went to one investor that apparently requested that no pricing information be made available on the tranche, which was initially talked at +475 over one-month Libor.

Meanwhile, Conseco is holding a beauty parade for a $500 million home equity issue slated for early first quarter, company officials said. According to one head of North American ABS, home equity issuers' move away from gain-on-sale accounting practices is allowing these deals to come to market at anytime during a financial quarter, as opposed to the historical practice of a quarter-end onslaught.

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